October 2014

Lying on a job application isn’t a new concept, but you might be surprised just how often it happens: According to results of a survey from The Society of Human Resource Managers, 53 percent of all job applications contain false information and 78 percent are misleading. What’s more, 70 percent of college students reported they’d lie on an application to get a job they really wanted.

Lying on an application is about more than dishonesty; it also leaves your company open to significant liability risks and losses. In fact, just one negligent-hiring lawsuit can wind up costing a business millions of dollars in addition to significant negative publicity and loss of customer trust.

Comprehensive background checks are the first line of defense when it comes to avoiding negligent-hiring lawsuits as well as theft, harassment and other criminal and civil issues, but too often, employers fail to implement policies effectively.

• Here are some tips to ensure your company is getting the most from its background checks:
• Search data from both national and countywide databases
• Be sure your policy adheres to the Fair Credit Reporting Act (FCRA); that means getting written authorization to conduct the check and recognizing the applicant’s right to dispute information turned up by the background check.
• Make sure the data you use in your hiring decision is based on relevant and factual information.
• Make sure you apply your background check process fairly and not just on specific applicants or groups of applicants.
• Establish criteria to determine which results will preclude employment and apply those criteria consistently.
• Review your process regularly to make sure it’s being implemented properly and to make any necessary changes to ensure it remains responsive.

Gathering background information on your potential employees is important not only for your company, but for your customers’ security as well. If you don’t have the skilled personnel to carry out background checks in-house, outsource the task to a company that specializes in employee screening.

Class action lawsuits involving the Fair Credit Reporting Act (FCRA) are on the rise; according to a report by the law firm Littler Mendelson, during June and July alone, more than a nationwide dozen class action suits were filed against employers across the country. Although many of these suits may appear to be based on the most trivial technicalities, they can still result in millions of dollars in losses.

FCRA suits generally arise as a result of two causes: Employers fail to follow proper protocol when obtaining a report from a credit reporting agency (CRA), or they fail to observe the steps required when information from a report results in an “adverse action.”

In a nutshell, here’s what you need to know:

• Before a company can obtain a report form a CRA, it must provide a written disclosure to the applicant, typically in a separate document that solely addresses the company’s intent to collect information.
• The applicant must provide written permission to allow collection of data from a CRA.
• When contacting the CRA, the company must certify that it is requesting the report for permissible purposes and that it is in compliance with FCRA and equal opportunity employment laws.
• If the company decides to take adverse action, such as denial of employment, based on information in the CRA report, it must first provide a notice to the applicant, including a copy of the CRA report and a copy of the statutory Summary of Rights. These rights provide the applicant with a chance to discuss and dispute the information prior to an action being taken.
• If the company decides to move forward with an adverse action, it must provide the adverse action notice to the applicant orally, by electronic methods or in writing.
• The adverse action must include: contact information for the CRA; a statement that indicates the CRA is not responsible for the action; a statement that the applicant has a right to obtain a copy of the report; and a statement that the applicant has the right to dispute the report’s contents.

During the past few decades, the workplace has changed significantly, and one of the biggest shifts has been in the number of years an employee remains with one employer. While a half century ago, it was “normal” practice for the majority of employees to remain with an employer for many years — sometimes entire careers — today’s employees are likely to change employers every few years. That’s bad news for employers: Workers who remain longer with a company attain a far deeper knowledge of the company, its brand, its products and its customer base, making them much more valuable than any new hire. And unlike a new hire that’s an “unknown quantity,” loyal, long-term employees can actually help reduce a company’s level of risk.

Still, when it’s time to take stock of a company’s assets, valuing employee loyalty can prove problematic; many companies wind up ignoring the value of loyal employees in favor of focusing on easy-to-grasp tangible assets. Likewise, many companies don’t bother to learn how to retain employees for the long term, or even know where to start.

Motivating employees to stay on board doesn’t have to be difficult. If you’re interested in learning what you can do, Monster.com offers the following tips:

• Implement career paths that offer opportunity for advancement, and let employees know how to advance in your company.
• Proactively monitor morale and seek out ways to help improve morale in ways that are meaningful to your employees.
• When devising management training programs, consider what makes a good, effective manager from a worker perspective rather than focusing in what management wants.
• When considering compensation, think beyond salary to include health insurance, vacation time, pension plans and other perks.
• Teach your managers how to provide consistent and valuable feedback and mentoring, and ensure they understand how to listen to employees and value their input.

Learning to retain employees isn’t rocket science; but it does take commitment and time. Take some time today to brainstorm ways your company can develop a workforce that’s as committed to your company’s success as you are.

During the past decade, diversity training has become a huge industry, with many companies implementing programs aimed at helping all employees feel valued while reducing bias and unfairness. That’s the stated purpose, and it sounds great; but when you get right down to it, the reason most companies implement diversity training programs is to, hopefully, reduce liability issues including potentially costly lawsuits. And what’s more, recent studies have been indicating that most diversity training programs simply don’t work.

In fact, one study from Harvard University looked at 829 companies over three decades and found that the training resulted in “no positive effects in the average workplace.” Even worse, the researchers also found that in workplaces where diversity training is mandatory, the training “actually has negative effects on management diversity.”

The researchers noted that the very nature of diversity training forces people to think in terms of categories. In the end, employees are more likely to dehumanize people than to see them as individuals.

Mentor programs appear to be very effective, the study says. Such programs can provide everyone with connections to “higher ups,” and they are generally better accepted than training programs, possibly because they are available to everyone, not just specific groups.

“Mentor programs put aspiring managers in contact with people who can help them move up, both by offering advice and by finding them jobs,” the study authors found. “This strategy appears to work.”

The study found another good approach to ensuring diversity in the current workplace and in hiring practices is to put one person or a group of people in charge, acting as a diversity manager or task force. Managers and task forces can be effective because they focus on identifying both specific problems and remedies.

“Managers and task forces feel accountable for change, and they monitor quarterly employment data to see if their efforts are paying off. If not, it’s back to the drawing board to sketch new diversity strategies.”

The take-home message: Don’t give up on diversity programs in your company, but do spend time exploring other options that may be more effective.